Want to be Rich – Basics
As we all know, this site is to guide individuals to become a millionaire then multi-millionaire and eventually billionaire. For this purpose, first we have to know the answers of following basic questions;
- Who is a millionaire?
- Who is multi-millionaire?
- Who is a billionaire?
This article will address the above questions and in the end, you will familiar with all of these terms.
Number One Point ‘Who is the Millionaire?
In simple words ‘Millionaire is an individual whose wealth or Net Worth is equivalent to or surpasses one million units of money’. Means if you have a million units of currency in your bank account then you are a millionaire.
Yes, the above statement is true but if you are living in a country with the least valued currency like Vietnam then the case is different.
One million Vietnamese Dong (VND) is equal to around 43 USD.
Our First advice:
To become a millionaire then consider United States Dollar (USD) or any other stable currency as your primary currency for wealth calculation. Now in Vietnam, if you have around 23,300,000,000 VND (Twenty-three billion three hundred million VND) in your bank account then you can call yourself a millionaire.
Is this simple that, if you have one million or equivalent USD in your bank account then you are a millionaire. This statement is not 100% true and here comes the term called Net worth.
Net Worth is equal to the value of all the assets owned by an individual deducting the value of all of its outstanding liabilities.
You can easily calculate your Net Worth by using the following formula;
Net Worth = Total Assets – Liabilities
Consider the following things to calculate your Total Assets;
- Cash in your hand
- Money in your bank accounts
- Total Value of your investments (Business, Stocks, Mutual Funds, Insurance and Forex, etc)
- Value of your car
- The market value of your home
- Personal belongings (Gold, Jewelry, Furniture, and other important items )
Add values of all the above things.
To calculate Total Liabilities add following things;
- Loans (Long and Short term)
- Credit card balance
Then subtract total liabilities value from the value of total assets to achieve the value of your Net Worth.
Now here is an example that you live in Mexico and you want to calculate whether you are a millionaire or not. For this purpose follow the following steps;
|Cash in Hand||5700 MXN|
|Money in Bank Accounts||55000 MXN|
|The market value of Home||120000 MXN|
|Personal Belongings||670000 MXN|
|Total Assets||2020700 MXN|
|Credit card balance||44000 MXN|
|Total Liabilities||164000 MXN|
|Net Worth in Mexican Peso||1856700 MXN|
|Net Worth in United States Dollar||97000 USD|
You can see that you are a millionaire in your local currency (MXN) but Short 903000 USD to become real millionaire, means you need ‘one million seven hundred twenty-five thousand’ MXN to become a millionaire.
You have to calculate your net worth in your local currency then convert that amount to USD to find the exact position.
After going through the above information I hope your concept about ‘Who is the Millionaire’ is clear.
Now come to other points that are who is multi-millionaire and who is a billionaire?
As per Oxford Dictionary ‘A person with assets worth several million pounds or dollars is Multi-millionaire’. But as per our opinion Multi-millionaire are those individuals whose Net Worth is equivalent to or surpasses at least five million USD. That is if you are living in Bangladesh then you must have at least ‘Four hundred twenty-four million Bangladeshi Taka’ net worth to call yourself Multi-millionaire.
Last but not least Billionaires are those individuals whose Net Worth is equivalent to or surpasses one billion USD (That is a thousand million USD). That is if you live in Singapore then you must have at least ‘one billion three hundred sixty million Singapore Dollar’ net worth to call yourself a Billionaire.
4 thoughts on “Want to be Rich – Basics”
Very detailed and informative article…
Thanks for your kind comments.
Why only US Dollar?
We recommend any stable international currency, it can be USD, Euro or Pound, etc.